Tuesday, February 14, 2012

Foxconn vs. Apple?

A copyright troll claims ownership in China of a brand Apple thought it had bought from the original company ... in Taiwan. Chinese IP law allows litigants to block export outside China as well as sales within China ...

... the tablet computers are under “temporary impoundment” from retailers in Xuzhou, a city of 1.8 million people in coastal Jiangsu Province, Ma Dongxiao, a lawyer for Proview’s creditors and the company, said by telephone. State-owned CCTV television confirmed the seizures in Xuzhou.

News reports Monday said that about 45 iPads had been confiscated from outlets in Shijiazhuang, the capital of Hebei Province, about 265 kilometers, or 165 miles, southwest of Beijing. Reports on the Chinese microblogging service Sina Weibo said that other retailers had removed iPads from displays, though some were selling them under the counter...

... court in Shenzhen, China, acting in a legal dispute between the two firms, dismissed Apple’s contention that it owned the iPad name in China ...

... Proview has also made a filing with the General Administration of Customs in China, he said, putting Apple on notice that the company could seek to block the export of iPads, should Proview’s ownership claims be upheld...
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.. Proview, based in Hong Kong, was once one of the world’s biggest makers of computer displays. But it fell into financial difficulties and was delisted by the Hong Kong stock exchange in 2010.
The company trademarked the name IPAD in several countries in 2000, intending to use it for a Web-capable hand-held device, but the project was scrapped, said Mr. Ma, the lawyer for the company. Apple bought the rights to the name from a subsidiary in Taiwan in 2009.

Proview now contends that that sale did not cover its Shenzhen subsidiary, which had registered the trademark in China. The Shenzhen court rejected Apple’s argument against that in December, but Apple is appealing that ruling. Proview has filed another lawsuit in Shanghai; arguments in that case will be heard this month, Mr. Ma said.

China can be a rough place for US citizens with Chinese features, but this moves things up a notch -- particularly because of the ability to block iPad exports (else Apple would probably rename the device in China).

China being what it is, I wonder if the courts would rule this way if Foxconn had Apple's back. I've been wondering about Foxconn ever since I saw pictures of their MacBook clones a few months ago.

If Foxconn has decided they no longer need Apple, then Apple will find their cash reserves handy. I wonder if the big boys are betting on a stock fall.